U.S. Treasury publishes five 'takeaways' on blockchain tech

The U.S. Treasury has released a list of five tips for companies implementing blockchains. The insights are based on lessons learned by the department while building its own blockchain proof of concept.

Assess suitability

The U.S. Department of the Treasury published the list on the Bureau of the Fiscal Service website this week. As reported by CoinDesk, it provides a starting point for the successful implementation of blockchain systems. The points are generalised and should be applicable to blockchain deployments in a wide range of industries.

The Department advises that the first step should be to determine whether blockchain is a good fit for the organisation. The technology is being publicised as a way to solve varied problems by greatly improving transparency and cross-industry collaboration. However, firms should first ensure they have a "deep understanding" of the problem they're trying to solve. Blockchain won't necessarily be the best solution.

The Treasury provided five questions which could help businesses determine when to use the blockchain. Typically, blockchain systems will be most applicable to processes that are currently centralised and dependent on trust.

The technology also lends itself to scenarios that revolve around regular routines and logic flows. Here, blockchain technologies such as smart contracts can significantly improve processing speed and overall efficiency.

Once the suitability of blockchain has been assessed, organisations should be working to understand the pain points in their implementation plan. Next, existing business processes should be mapped out to identify the friction points. This stage informs the deployment of the blockchain system by highlighting the business areas most likely to benefit from its introduction. Finally, firms should create a diverse project team and assess the need for agency governance.

Creating a process

The Treasury noted that none of the points directly concern blockchain technology itself. Instead, they're abstract lessons which could also be applied to wider digital transformation initiatives. The Treasury settled on the five points after evaluating what it's learnt from its own blockchain pilot program, which uses bots to streamline financial management processes at federal agencies.

"There's much hype around blockchain technology. Over the past five months, our blockchain proof of concept helped us gain a better understanding of what the technology can and cannot do," said the Treasury. "Surprisingly, five of the most important lessons learned coming out of our blockchain proof of concept had nothing to do with the technology, but some points that deserve attention."

Blockchain has the potential to overhaul inefficient business processes at organisations across the world. However, successful implementations are dependent on several external factors, including the abilities of the project team and effective integration with existing systems. The Treasury's points provide a set of guidelines for enterprises and developers but each individual deployment will include its own unique considerations.